Thank you, Livingston. Good morning, ladies and gentlemen. It's good to see all of you at this, the 33rd meeting of the Commercial Space Transportation Advisory Committee. The men and women of COMSTAC perform a very significant role in helping guide those of us in government in the oversight of commercial space activity. We are very appreciative of all that you do on behalf of the FAA and the Department of Transortation. With today's meeting, we are initiating a new practice to expand the interaction and understanding between the space transportation sector and the aviation sector.

During our annual Commercial Space Transportation Forecast conference last February, my colleague Steve Brown, acting FAA Associate Administrator for Air Traffic Services, suggested, as some of you may recall, that a commercial space transportation industry representative join the Air Traffic Procedures Advisory Committee, known by its acronym, "ATPAC". I'm happy to tell you that your chairman Livingston Holder has graciously taken on the responsibility to act as your representative on the ATPAC. I'm very certain that his involvement will bring about what is intended -that being a focused, structured collaboration among principle users of the National Airspace System in order to bring forth the best the system can offer to all of its users in terms of safety, efficiency, and security.

Steve Brown also suggested during his talk at our conference that the COMSTAC invite a representative from the aviation industry to participate at its meetings. So in the spirit of partnership and cooperation, I am pleased to welcome Mr. Charles Hall, Manager, Air Traffic Systems, of American Airlines to COMSTAC. Charles was a chairman of the National Airspace redesign committee for RTCA, a technical standards setting organization. He will offer the committee different, fresh, and welcome perspectives that that will help further the commercial space transportation industry's incorporation into what we like to view as the National "Aerospace" System of the future.

Now, let me take a moment to comment on something that has happened quite recently that I think constitutes a significant event in the evolution of commercial space transportation. I am talking about the flight of U.S. businessman Dennis Tito to International space station Alpha aboard a Russian Soyuz rocket.

Without getting into the discussion of whether or not Mr. Tito should have made the trip, or whether this was not the right time for such a visit, the fact is that a commercial passenger has journeyed into space as a paying passenger, the first acknowledged "space tourist," even if Mr. Tito prefers another term for it.

An ordinary citizen, albeit a wealthy one, has been able to act on a desire, shared by many people, to feel the thrill of lift-off, to experience weightlessness, and to view our planet from an entirely new perspective. In and of itself, pretty exciting.

Whatever the misgivings or valid concerns about the appropriateness of this trip at this time, it has happened, and it cannot be undone. The question is no longer "will there be space tourism?", but "what is the next development in space tourism?" The fact that 75% of the respondents in a poll by Space.com released this week favored the Tito flight is pretty strong evidence that the market is out there.

In October when last we met, my deputy, Joe Hawkins, opened his remarks by commenting on the recent and welcome passage by Congress of the extension for four years to the Indemnification Provision of the Commercial Space Launch Act. The legislation required AST to prepare a report on various aspects of this liability risk-sharing including potential options for Congress to consider when next the sunset of this provision comes up.

We have shared this task with COMSTAC, which will report on the issue from its perspective in the Fall, but we have taken a major step in the broader information gathering specified by Congress. Just two weeks ago we began an actual and virtual public meeting, the virtual Internet component of which ends tomorrow. The docket or file for this activity will remain open and we encourage you to file your comments.

AST is in the midst of an aggressive recruitment effort to fill the additional slots we have been granted in our increased appropriation for this year. The Fiscal Year 2001 increase, allowing our staff to grow from 34 to 69, will give AST the resources to handle the expected growth of the industry in coming years. The new staff additions and the expanded expertise will help ensure launch safety while responding to the needs of new vehicle technology developers, and the spread of non-federal launch sites, the international competitiveness we continue to foster, and other demands.

Since last we met, the AST staff has changed, reflecting both losses and additions. In January, Carl Rappaport, a resource of knowledge and experience in AST since its inception as the Office of Commercial Space Transportation back in 1984, retired. Also, recently Michael Etchart of our Licensing and Safety Division, and Nick Himaras, who headed AST's Environmental Program, have moved on to "other" as I would like to say rather than "bigger and/or better" things.

In the case of Nick Himaras, who was a long time AST employee, he has moved back to his native Greece and is employed there. However, to balance these losses of some very key people in our organization we have added to our Space Systems Development Division two outstanding analysts in John Sloan, and Amy Snyder; and our Licensing and Safety Division has brought on outstanding engineering talent in Michael Chang and Paul Wilde.

I am very proud to say that each new employee that we've brought on has hit the ground running in full stride and is making key contributions. I am also pleased to announce that I have selected Kelvin Coleman as my Special Assistant for Programs and Planning. Kelvin, as many of you know, leads one of our key strategic projects, SATMS, and played a key leadership role in the development of our recently signed MOA with the Air Force on roles and responsibilities for commercial space transportation safety and range activities.

As part of this expansion, we have created a new division, the Systems Engineering and Training Division, and it is my pleasure to introduce our newest division manager, Hugh Cook. Hugh brings over 19 years of extensive experience in the launch services industry. This includes serving as Principal Engineer for Ordinance and Solid Rocket Motors for General Dynamics Corporation, Director of Space Systems Programs for EER Systems and most recently as Director of Launch Operations and Engineering for Beal Aerospace.

As we flesh out this division and add new expertise and experience to our Licensing and Safety and Space Systems Development Divisions, we will be better able to meet the growing needs of our evolving responsibilities in a changing industry.

As you know from past reports before this committee, we have been working to build an FAA infrastructure to integrate space vehicle and airplane expertise. This is to ensure that the necessary assistance is provided to RLV companies in the development and operation of their vehicles. A key component of this infrastructure is the RLV Operations Safety Approval Process. Some of you heard Joe Hawkins, my deputy, talk about this yesterday at the RLV working group. Working with our aviation colleagues within the Commercial Space Transportation Integrated Product Team, and supported by comments submitted by RLV Working Group members, the RLV Operations Safety Approval Process documents an integrated FAA approach to conducting safety reviews and assessments for RLVs.

It is intended to guide the agency and companies in the steps needed to ensure that new launch vehicle technology that embodies both rocket and airplane operational characteristics are properly evaluated, and the appropriate approvals are identified and administered. Once we had achieved a draft document in which we felt confident, we began planning a method to simulate the effectiveness of the process. A tabletop exercise was conducted in February of this year, and the results indicated that we had been successful in developing a structure that we all could support. The Associate Administrator for Regulations and Certification and I have endorsed this document in partnership as a key step towards our continued support for the RLV industry.

In a related area, I had the opportunity in March to participate in an international Working Group on Space Traffic Management in Seville, Spain. The working group had the mandate to 1)"Examine the need for an improved global traffic management framework in the increasingly crowded space environment. 2) Identify implementable approaches to space traffic management and the reduction of space traffic hazards for all space users. 3) Explore international methods for coordination, regulation, and enforcement of space 'rules of the road.'"

Our group came up with five "Findings" and 15 "recommendations." Findings covered the current situation, including the lack of clear legal guidance regarding many space activities, the lack of and need for a codified set of Rules of the Road for space operations, and space debris catalogues that are inadequate to enable effective collision avoidance.

Recommendations covered both formal and informal steps that could be taken to mitigate this situation, ranging from action by U.S. committees to launching state to launching state agreements on basic operational matters and commonality.

One of the more alarming areas we covered was the threat of orbital debris to the geostationary orbit (GEO) and its vulnerability to any event which would create a debris field in this narrow band so essential to much of space commerce, science and security.

One promising area we focused on was the desire to make greater use of disposal orbits on the part of all of the participating countries, with steps taken to mandate the use of these graveyard orbits for spent satellites through the international regulatory process.

All in all, it was a very interesting and informative exercise.

Immediately after that meeting, Division Manager Herb Bachner and I traveled to China for consultations under the "Memorandum of Agreement Between the Governments of the United States and the People's Republic of China Regarding International Trade in Commercial Launch Services." This was the first consultation since the two sides met in Washington, D.C. in 1997.

During the consultations, the two sides reviewed the implementation of the Agreement, exchanged commercial satellite launching information, and discussed the Agreement itself. The talks were informative and candid, with both sides improving mutual understanding. Timing is everything! I am glad it was the week of March 18, and not the week of April 1, when the reconnaissance plane incident occurred.

On another front, work continues on the implementation of the recommendations contained in the interagency report on The Future Management and Use of the U.S. Space Launch Bases and Ranges. Follow-up action is continuing with the Air Force, Department of Commerce and NASA. We are currently working with Commerce to develop a program to collect and communicate commercial requirements to the Air Force to be considered within their budget process, to be one of two processes for receiving commercial requirements. With the Air Force, we are developing common safety standards for commercially licensed launch operations for federal and non-federal ranges. Common range safety standards will enable launch operations to occur from any launch base and range with the same level of public safety. They also allow a single vehicle configuration to meet both FAA licensing requirements and government launch requirements at federal launch sites, reducing cost and duplication. This is a desire and a goal to which we and the Air Force are fully committed.

The former effort is to provide the commercial customers of the range with a voice in the Air Force budget planning process to improve and modernize space launch bases and ranges. The commercial operators are in a highly competitive international marketplace. I am hopeful that including industry requirements in the planning should result in changes to range operations and equipment modernization that will reduce range costs and time to launch.

By next week we expect to have a draft Memorandum of Agreement among the Air Force, Department of Commerce and FAA on commercial input for the Air Force budget process, and by June 1 we will meet with the Air Force on the need to formalize what has been an informal working group on common safety standards.

We have a full agenda today, highlighted by our annual presentation of the GSO and LEO Mission Models, a report on the Space Commission by Air Force Lt. Col. Bill Harding, and a presentation by our own Legal Counsel Esta Rosenberg on the FAA Study of Liability and Risk Sharing requested by Congress.

Of tremendous interest to all of you I am sure, will be a presentation to be given by Vic Villhart of the Office of Science and Technology Polidy at the White House. Vic will report on the White House Space Issues Management Process.

In addition, we are honored to have Brian Wagner of Congressman Ken Calvert's staff and Cathy Travis of Congressman solomon Ortiz's staff join us to discuss important new legislation, the "Invest in Space Now Act of 2001," to be introduced by their two Members and others.

We will also have the customary reports from our working groups on Technology and Innovation, Reusable Launch Vehicles, Risk Management and Launch Operations and Support.